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ACTUAL VOLUNTARY TURNOVER:

A STUDY OF JOB EMBEDDEDNESS, PAY

SATISFACTION, AND PERCEIVED ALTERNATIVE

JOB OPPORTUNITIES

TALATU RAIYA UMAR

DOCTOR OF PHILOSOPHY

UNIVERSITI UTARA MALAYSIA

July 2016

i

ACTUAL VOLUNTARY TURNOVER: A STUDY OF JOB

EMBEDDEDNESS, PAY SATISFACTION, AND PERCEIVED

ALTERNATIVE JOB OPPORTUNITIES

By

TALATU RAIYA UMAR

Thesis Submitted to

Othman Yeop Abdullah Graduate School of Business,

Universiti Utara Malaysia,

in fulfillment of the Requirement for the Degree of Doctor of Philosophy

iv

PERMISSION TO USE

In presenting this thesis in fulfilment of the requirements for a postgraduate degree

from Universiti Utara Malaysia, I agree that the Universiti Library may make it

freely available for inspection. I further agree that permission for the copying of this

thesis in any manner, in whole or in part, for scholarly purpose may be granted by

my supervisor(s) or, in their absence, by the Dean of Othman Yeop Abdullah

Graduate School of Business. It is understood that any copying or publication or use

of this thesis or parts thereof for financial gain shall not be allowed without my

written permission. It is also understood that due recognition shall be given to me

and to Universiti Utara Malaysia for any scholarly use which may be made of any

material from my thesis.

Requests for permission to copy or to make other use of materials in this thesis, in

whole or in part should be addressed to:

Dean of Othman Yeop Abdullah Graduate School of Business

Universiti Utara Malaysia

06010 UUM Sintok

v

ABSTRACT

Past literature supports negative links between job embeddedness, pay satisfaction

and actual voluntary turnover (AVT), several meta-analytical studies have reported

weaker links between these constructs. As a result, calls for further research has been

suggested, particularly on the interactive process through which both job

embeddedness and pay satisfaction are likely to influence AVT. The purpose of this

study was also to explore the likely interactive effect of perceived alternative job

opportunities on job embeddedness, pay satisfaction, and AVT. A mixed-method

approach was used. Data were obtained from a survey sample of 216 and nine

interviewed former faculty members of public universities in Nigeria. Using partial

least square structural equation modelling (PLS-SEM), the quantitative results

indicated that both organizational embeddedness and pay satisfaction were

significantly and negatively related to AVT. On the contrary, community

embeddedness demonstrated no significant effect on AVT. The results further

showed that perceived alternative job opportunities moderated the relationship

between organizational embeddedness and AVT, as well as between pay satisfaction

and AVT. But, no significant interaction effect was found between perceived

alternative job opportunities and community embeddedness. In addition to the

survey, semi-structured interviews were conducted. The results of the interviews

showed that the dysfunctional nature of the university’s work environment and

longer commute time were important contributors to their reason for leaving. The

qualitative result also revealed that the disparity in pay between public and private

universities played a critical role in the participants’ decisions to actually leave.

Additionally, unsolicited job offer was also identified as another reason that

influenced their turnover decisions. Overall, the qualitative results complemented the

survey findings in that they were able to further clarify and elaborate the latter.

Implications of the results for future research and practice, as well as the limitations

of the study are highlighted.

Keywords: actual voluntary turnover, job embeddedness, pay satisfaction,

perceived alternative job opportunities, mixed-method, Nigeria

vi

ABSTRAK

Kesusasteraan masa lalu menyokong hubungan negatif antara sematan pekerjaan,

kepuasan bayaran, dan lantik henti sebenar secara sukarela (AVT), beberapa kajian

meta analisis telah melaporkan pautan lemah antara konstruk-konstruk ini.

Akibatnya, terdapat panggilan mengenai kajian yang lebih lanjut bagi meneliti

hubungan ini terutamanya yang melibatkan proses interaktif antara kedua-dua

sematan kerja dan kepuasan bayaran yang mungkin mempengaruhi AVT. Tujuan

kajian ini juga adalah untuk meneroka kesan interaktif kemungkinan peluang

pekerjaan alternatif ditanggap terhadap sematan pekerjaan, kepuasan bayaran, dan

AVT. Pendekatan kaedah bercampur telah digunakan. Data dikutip daripada tinjauan

terhadap 216 orang bekas ahli fakulti dan sembilan fakulti yang telah ditemuramah

di universiti awam di Nigeria. Dengan menggunakan partial least square structural

equation modelling (PLS-SEM), keputusan kuantitatif menunjukkan bahawa kedua-

dua sematan organisasi dan kepuasan bayaran berkait dengan AVT secara signifikan

dan negatif. Sebaliknya, sematan masyarakat tidak menunjukkan kesan ketara

terhadap AVT. Keputusan seterusnya menunjukkan bahawa peluang pekerjaan

alternatif ditanggap menyederhana hubungan antara sematan organisasi dan AVT,

serta antara kepuasan gaji dan AVT. Tetapi, tiada kesan interaksi yang signifikan

antara peluang pekerjaan alternatif ditanggap dan sematan masyarakat. Di samping

tinjauan soal selidik, temu bual separa berstruktur telah dijalankan. Hasil temu bual

menunjukkan bahawa persekitaran kerja universiti yang lemah dan masa berulang-

alik yang panjang merupakan penyumbang penting ahli fakulti akademik

meninggalkan pekerjaan mereka. Dapatan kualitatif juga menunjukkan bahawa

perbezaan jurang gaji antara universiti awam dan swasta memainkan peranan penting

bagi peserta membuat keputusan meninggalkan pekerjaan lama mereka. Selain itu,

tawaran pekerjaan yang tidak diminta juga telah dikenal pasti sebagai satu lagi

penyebab yang mempengaruhi keputusan mereka untuk berhenti. Secara

keseluruhan, dapatan kualitatif melengkapi hasil tinjauan kerana dapatan temu bual

dapat menerangkan dan menghuraikan keputusan kuantitatif. Implikasi penyelidikan

terhadap kajian akan datang dan amalan serta batasan kajian ini turut diketengahkan.

Kata kunci: lantik henti sebenar secara sukarela, sematan pekerjaan, kepuasan

bayaran, peluang pekerjaan alternatif ditanggap, kaedah bercampur, Nigeria

vii

ACKNOWLEDGEMENT

Alhamdulillah

All praises and thanks are to Almighty Allah, the Most Merciful. First, I

must express my sincere gratitude to Allah (SWT) who out of His infinite mercy

gave me the wherewithal to successfully complete my doctoral work. May the peace

and blessings of Allah (SWT) be upon our beloved prophet Muhammad (PBUH).

The challenges of completing this thesis are indeed filled with precious and

unforgettable memories.

In completing this thesis, various persons have inspired me of whom I would

like to acknowledge and thank. I would like to sincerely express my thanks to my

three supervisors, Assoc. Prof. Dr. Faridahwati Bt Mohd Shamsudin, Assoc. Prof.

Dr. Chandrakantan a/l Subramaniam, and Dr. Johanim binti Johari, for their

supervision, support and insightful feedback. All of them deserve the highest credit

for their professionalism, patience, and giving me the freedom to seek knowledge. I

value their wisdom and I am indeed very fortunate to have them as my supervisors. I

also wish to express my appreciation to the panel of the Oral Examination Board for

their comments and suggestions during my viva session.

I am deeply indebted to the management of Kaduna Polytechnic, Kaduna

Nigeria for supporting my study leave. My PhD journey would be much more

difficult without the constant support from my beloved family. On a more personal

note, I would like to thank and dedicate this thesis to them, especially, my husband,

parents, and my children for their love, and endless support.

viii

TABLE OF CONTENT

Title Page

TITLE PAGE i

CERTIFICATION OF THESIS WORK ii

PERMISSION TO USE iv

ABSTRACT v

ABSTRAK vi

ACKNOWLEDGEMENT vii

TABLE OF CONTENT viii

LIST OF TABLES xii

LIST OF FIGURES xiii

LIST OF ABBREVIATIONS xiv

CHAPTER ONE: INTRODUCTION 1

1.1 Background of Study 1

1.2 Statement of Research Problem 8

1.3 Research Questions 12

1.4 Research Objectives 13

1.5 Scope of Study 14

1.6 Significance of Study 14

1.7 Definition of Key Terms 16

1.7.1 Actual Voluntary Turnover 17

1.7.2 Job Embeddedness 18

1.7.3 Pay Satisfaction 18

1.7.4 Perceived Alternative Job Opportunities 19

1.7 Organization of Thesis 19

CHAPTER TWO: LITERATURE REVIEW 20

2.1 Introduction 20

2.2 Actual Voluntary Turnover 20

2.3 Actual Voluntary Turnover Predictors 24

2.4 Relationship between Actual Voluntary Turnover and Turnover Intention 36

2.5 Pay Satisfaction 43

2.6 Job Embeddedness 52

2.7 Moderator 61

2.8 Underpinning Theory 69

2.8.1 Social Exchange Theory 69

2.8.2 Job Embeddedness Theory 72

2.8.3 Social Interdependence Theory 74

2.9 Summary 76

CHAPTER THREE: RESEARCH FRAMEWORK DEVELOPMENT 77

3.1 Introduction 77

3.2 Research Framework 77

3.3 Hypotheses Development 78

3.3.1 Relationship between Job Embeddedness and AVT 78

ix

3.3.2 Relationship between Pay Satisfaction and AVT 80

3.3.3 Moderating Role of Perceived Alternative Job Opportunities on the

Relationship between Job Embeddedness and AVT 82

3.3.4 Moderating Role of Perceived Alternative Job Opportunities on the

Relationship between Pay Satisfaction and AVT 83

3.4 Summary 85

CHAPTER FOUR: METHODOLOGY 86

4.1 Introduction 86

4.2 Research Paradigm 86

4.3 Research Design 90

4.3.1 Mixed-Method Approach 91

4.3.2 Mixed-Method Research Design 92

4.4 Target Population 93

4.5 Quantitative Phase of the Study 95

4.5.1 Sample Size 95

4.5.2 Sampling Technique 99

4.6 Measurement of Constructs and Instrumentation 103

4.6.1 Reflective and Formative measures 105

4.6.2 Differences between Reflective and Formative Indicators 105

4.6.3 Second-Order Factor 107

4.6.4 Job Embeddedness 108

4.6.5 Actual Voluntary Turnover 109

4.6.6 Perceived Alternative Job Opportunities 110

4.6.7 Pay Satisfaction 110

4.6.8 Demographic Data 111

4.7 Data Collection Procedure 114

4.7.1 Translation 114

4.7.2 Pre-testing of the Instrument 114

4.7.3 Pilot Test 115

4.7.4 Administration of Survey Questionnaire 118

4.8 Data Analysis 120

4.9 Qualitative Phase of the Study 121

4.9.1 Sample Size 122

4.9.2 Sampling Technique 122

4.9.3 Interview Protocol 123

4.9.4 Pilot Test 125

4.9.5 Semi-Structured Interview 125

4.9.6 Thematic Analysis 130

4.10 Summary 133

CHAPTER FIVE: FINDINGS 134

5.1 Introduction 134

5.2 Response Rate 134

5.3 Preliminary Data Analysis 137

5.3.1 Missing Value Analysis (MVA) 138

x

5.3.2 Outliers Detection and Treatment 139

5.4 Non-Response Bias 141

5.5 Common Method Variance 142

5.6 Demographic Characteristics of Participants 144

5.7 Descriptive Statistics of the Latent Constructs 146

5.8 Model Assessment 147

5.8.1 Measurement Model Assessment 148

5.8.1.1 Convergent Validity 150

5.8.1.2 Discriminant Validity 155

5.8.2 Structural Model Assessment 158

5.8.2.1 Level of R2 158

5.8.2.2 Effect Size (f2) 159

5.8.2.3 Predictive Relevance of the Research Model 161

5.8.2.4 Path Coefficients and Tests of Hypotheses 162

5.8.2.5 The Main Effects 162

5.8.2.6 The Moderation Effects 164

5.9 Strength of the Moderating Effects 170

5.10 Summary of Quantitative Findings 171

5.11 Qualitative results 171

5.11.1 Interview Questions 172

5.11.2 Demographic Profiles of Interview Participants 172

5.11.3 Coding Process 174

5.12 Emergent Themes 175

5.12.1 Theme 1: Consideration for changing Employer 175

5.12.2 Theme 2: Process of changing Employer 176

5.12.3 Theme 3: Challenges 177

5.12.4 Theme 4: Expectations 178

5.13 Summary 179

CHAPTER SIX: DISCUSSION and CONCLUSION 181

6.1 Introduction 181

6.2 Recapitulation of Major Findings 181

6.3 Discussions 182

6.4 Direct Effects of Organisational Embeddedness 183

6.5 Direct Effects of Community Embeddedness 188

6.6 Direct Effects of Pay Satisfaction 191

6.7 Moderating Effect of Perceived Alternative Job Opportunities 193

6.8 Implications of the Results 196

6.8.1 Theoretical Implications 196

6.8.3 Practical Implications 200

6.9 Study Limitation and Suggestions for Future Research 202

6.10 Conclusion 203

REFERENCES 204

APPENDICES: 287

Appendix A: Research Questionnaire 287

xi

Appendix B: Interview Protocol 294

Appendix C: Informed Consent Form 296

Appendix D: Qualitative Methods and Data 297

Appendix E: Summary of selected studies on AVT 298

xii

LIST OF TABLES

Table Page

Table 4.1 Private Universities located in the Southern part of Nigeria 95

Table 4.2 Disproportionate Stratified Random Sampling of Participants 103

Table 4.3 Guidelines to Ascertain Formative and Reflective Models 107

Table 4.4 Instrument used 113

Table 4.5 Summary of Pilot Test Reliability Results 118

Table 4.6 Steps in Thematic Analysis 131

Table 5.1 Response Rate of the Survey Questionnaire 137

Table 5.2 Independent-Samples T-Test for Non-response bias 142

Table 5.3 Demographic Characteristics of Participants 145

Table 5.4 Descriptive Statistics for Latent Constructs 146

Table 5.5 Loadings, Reliability and Average Variance Extracted 151

Table 5.6 Outer weight and Variance Inflation Factor 153

Table 5.7 Nomological Validity 155

Table 5.8 Discriminant validity (Fornell-Larcker Criterion) 156

Table 5.9 Cross Loadings 157

Table 5.10 Variance Explained in the Endogenous Latent construct 159

Table 5.11 Effect Sizes of the Latent Constructs 160

Table 5.12 Construct Cross-Validated Redundancy 161

Table 5.13 Structural Results (Main Effects without Interactions) 164

Table 5.14 Structural Results ( with Interactions) 167

Table 5.15 Strength of the Moderating Effects 170

Table 5.16 Summary of Hypotheses Testing 171

Table 5.17 Qualitative Participants Demographic 173

xiii

LIST OF FIGURES

Figure Page

Figure 3.1 Theoretical Framework 78

Figure 4.2 Formative and Reflective Indicators 106

Figure 5.1 Measurement Model 150

Figure 5.2 Structural Model without Interaction 163

Figure 5.3 Structural Model with Interaction 167

Figure 5.4 Interaction effect of Organizational Embeddedness and PAJO 168

Figure 5.5 Interaction effect of Pay Satisfaction and PAJO 169

xiv

LIST OF ABBREVIATIONS

ASUU Academic Staff Union of Universities

AVE Average Variance Extracted

AVT Actual Voluntary Turnover

CAQDAS Computer Assisted Qualitative Data Analysis

CMV Common Method Variance

EM Expectation Maximization

EOI Employment Opportunity Index

HEI Higher Education Institution

JET Job Embeddedness Theory

MI Multiple Imputations

MVA Missing Value Analysis

NUC National Universities Commission

PAJO Perceived Alternative Job Opportunities

PSQ Pay Satisfaction Questionnaire

SET Social Exchange Theory

SIT Social Interdependence Theory

SPSS Statistical Package for the Social Sciences

VIF Variance Inflation Factor

1

CHAPTER ONE

INTRODUCTION

1.1 Background of Study

In the recent past, actual voluntary turnover (AVT) has become a subject of

importance among practitioners and researchers of organizational behavior (Allen,

Bryan, & Vardaman, 2010; Hancock, Allen, Bosco, McDaniel, & Pierce, 2013;

Segrest, Andrews, & Hurley-Hanson, 2015). As a self-initiated behavior (Morrell,

Loan-Clarke, & Wilkinson, 2001), actual voluntary turnover occurs when employees

actually disengage or leave the organization on their own accord (Böckermann,

Ilmakunnas, Jokisaari, & Vuori, 2013; Davidson & Wang, 2011). In this instance,

the actual permanent voluntary disengagement may have been influenced by another

job which offers more in terms of meeting employee expectation, changes in

personal circumstances, or d a change in career direction (Donnelly & Quirin, 2006).

Put differently, actual voluntary turnover refers to an employee exercising his or her

free choice to voluntarily leave a current employment in favor of opportunities

identified with another (Beecroft, Dorey, & Wenten, 2008).

As a costly and pervasive phenomenon, actual voluntary turnover has

continued to draw the attention of practitioners and researchers (Clausen, Hogh,

Carneiro, & Borg, 2013; Huffman, Casper, & Payne, 2014; Hom, Mitchell, Lee, &

Griffeth, 2012; Law, 2010; Maertz & Boyar, 2012; Maynard & Parfyonova, 2013;

Steel & Lounsbury, 2009). Existing literature has shown that AVT not only results in

The contents of

the thesis is for

internal user

only

204

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